China’s Interests in the Arctic

by

Commander William G. Dwyer III United States Coast Guard

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United States Army War College Class of 2015

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14. ABSTRACT

China has been active in the Arctic for many years conducting climate research and expeditions. Over the

last few years, China has made overtures for greater involvement in Arctic affairs and governance seeking

full membership status in the Arctic Council and further collaboration with Arctic nations. China's interest in

the Arctic is driven by the need to fuel and feed the world's largest population and most powerful economy.

This study begins with a review of China's historical activities in the Arctic then argues that its recently

intensified interest there is driven by two factors: natural resources and new maritime trade routes. Next, it

suggests venues for increased Chinese participation in the governance structures for the Arctic and

concludes with recommendations of concrete steps that the United States can take to encourage China's

responsible behavior in this dynamic international sphere of cooperation. The United States, as the

incumbent chair of the Arctic Council in 2015, will need to work with the Chinese government to ensure

both responsible stewardship and activities in the Arctic.

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U.S. Strategy, Coast Guard, Icebreaker, Oil, Fisheries, Law of the Sea

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China’s Interests in the Arctic

by

Commander William G. Dwyer III United States Coast Guard

Professor Brett Weigle Department of Military Strategy, Planning and Operations

Project Adviser This manuscript is submitted in partial fulfillment of the requirements of the Master of Strategic Studies Degree. The U.S. Army War College is accredited by the Commission on Higher Education of the Middle States Association of Colleges and Schools, 3624 Market Street, Philadelphia, PA 19104, (215) 662-5606. The Commission on Higher Education is an institutional accrediting agency recognized by the U.S. Secretary of Education and the Council for Higher Education Accreditation. The views expressed in this student academic research paper are those of the author and do not reflect the official policy or position of the Department of the Army, Department of Defense, or the United States Government.

U.S. Army War College

CARLISLE BARRACKS, PENNSYLVANIA 17013

Abstract Title: China’s Interests in the Arctic Report Date: 01 April 2015 Page Count: 33 Word Count: 5,000 Key Terms: U.S. Strategy, Coast Guard, Icebreaker, Oil, Fisheries, Law of the

Sea Classification: Unclassified

China has been active in the Arctic for many years conducting climate research and

expeditions. Over the last few years, China has made overtures for greater involvement

in Arctic affairs and governance seeking full membership status in the Arctic Council

and further collaboration with Arctic nations. China's interest in the Arctic is driven by the

need to fuel and feed the world's largest population and most powerful economy. This

study begins with a review of China's historical activities in the Arctic then argues that its

recently intensified interest there is driven by two factors: natural resources and new

maritime trade routes. Next, it suggests venues for increased Chinese participation in

the governance structures for the Arctic and concludes with recommendations of

concrete steps that the United States can take to encourage China's responsible

behavior in this dynamic international sphere of cooperation. The United States, as the

incumbent chair of the Arctic Council in 2015, will need to work with the Chinese

government to ensure both responsible stewardship and activities in the Arctic.

China’s Interests in the Arctic

The Arctic environment is in great flux as scientific studies show the Arctic ice

cap has diminished by 40% over the past 35 years.1 Polar scientific research is being

conducted to better understand the changing Arctic ecosystem and the effects of the

warming Arctic upon the world’s climate. The Arctic Ocean and coastal areas once

barren and frozen under a dense sheet of ice are slowly coming to life with industry and

commerce brought about by the receding ice conditions.

These environmental changes bring new opportunities for the eight Arctic nations

(United States, Russia, Iceland, Denmark, Canada, Norway, Finland, and Sweden) that

ring the North Pole (figure 1). Arctic nations are competing for abundant resources such

as oil, natural gas, minerals, and fish stocks that the newly accessible Arctic contains.

The receding ice will open additional maritime trade routes that will relieve the

increasingly stressed global marine transportation system between Asian, European,

and North American ports. These new trade routes are known as the Northern Sea

Route (NSR), the Transpolar Sea Route (TSR), and the once-legendary Northwest

Passage (NWP); this study will address them in more detail.

Although it has no Arctic littoral, China has been active in the Arctic for many

years conducting climate research and scientific expeditions. Over the last few years,

China has signaled for greater involvement in Arctic affairs and governance by seeking

full membership status in the Arctic Council and further collaboration with the Arctic

nations. China's interest in the Arctic is driven by the need to fuel and feed the world's

largest population and economy.

This study begins with a review of China's historical activities in the Arctic then

argues that its recently intensified interest there is driven by two factors: 1) new sources

2

of oil, natural gas, minerals and fish, and 2) additional maritime trade routes. Next, it

suggests venues for increased Chinese participation in the governance structures for

the Arctic and concludes with recommendations of concrete steps that the United States

can take to encourage China's responsible behavior in this dynamic international sphere

of cooperation. As the incumbent chair of the Arctic Council in 2015, the United States

must work with the Chinese government to ensure the latter engages in responsible

stewardship and activities in the Arctic.

Figure 1: The Arctic2

3

China’s History in the Arctic

China’s interest in the Polar Regions dates back over thirty years. The Chinese

Arctic and Antarctic Institute that directs the nation’s polar research program was

established in 1981.3 China’s initial national interest in the Arctic was related to scientific

research to study climate change. Chinese scientists have been seeking to better

understand the effects of changing Arctic conditions upon the weather patterns in

China.4 China has since conducted numerous expeditions to both the North and South

Poles.5 China built a permanent Arctic research facility in 2004.6 Located in Norway, its

mission is to study and monitor climate change in the Arctic region.7

Since 2007, publications in China have shifted from a purely scientific focus to

more strategic, political, and legal issues concerning the Arctic region.8 China

conducted four independent Arctic missions by 2010 aimed at scientific research,

partnership building, and economic opportunities.9 Understanding Arctic environmental

conditions, their potential effects on China’s climate and weather, and taking proactive

steps in the form of domestic environmental policy changes may help China maintain its

global economic position. Looking ahead, China’s Twelfth Five Year Plan calls for

increased polar research.10

Despite the aforementioned activity, China has no declared official Arctic policy.

Rather, Chinese officials have issued statements espousing their interest in the

environmental impacts of the changing Arctic climate.11 Unlike its position in the South

China Sea, the Chinese government has expressed that the Arctic should be open to all

nations – not simply those with territory in the region. This attitude indicates its intent to

compete for the potentially immense natural resources the Arctic possesses and a

subtle warning to any nation that looks to control the Arctic waterways. China’s State

4

Oceanic Administration has called the Arctic the “inherited wealth of all

humankind…and not the ‘private property’ of the Arctic nations...every country in the

world has an equal right to exploit the Arctic Ocean.”12 The use of the word “exploit” may

signal a much greater intent than simple scientific research. China sees the Arctic as an

opportunity to meet its growing energy, mineral, and food needs.

The region is rich in natural resources needed to sustain China’s large population

and demands from its rising middle class. In July 2014, China’s population was

estimated at 1.4 billion people, the world’s largest and nearly five times larger than the

U.S. population.13 China’s government has used many different voices to express its

intent to compete for Arctic access and resources. A leading Chinese academic stated,

“Whoever has control of the Arctic route will control the new passage of world

economics and international strategies.”14 A Chinese Navy official claimed that since

20% of the world’s population is located in China, it is entitled to 20% of the resources

contained in the Arctic.15 Before discussing China’s goals in the Arctic, let’s examine the

international legal framework that governs nations’ actions there.

The United Nations Convention on the Law of the Sea

The 1982 United Nations Convention on the Law of the Sea (UNCLOS) is the

maritime framework of legal governance and cooperation. Amongst other particulars,

UNCLOS includes express dispute resolution mechanisms for natural resource and

maritime boundary line disputes through arbitration.16 Unlike the other seven Arctic

nations, the United States has yet to join the 156 signatories to UNCLOS and ratify it

because of concerns about political sovereignty. However, the U.S. government has

affirmatively stated its commitment to the principles of the treaty.17 It currently regards

UNCLOS as customary international law; however, this approach does not allow it to

5

take advantage of the UNCLOS dispute resolution process. UNCLOS membership

would aid U.S. sovereignty efforts through the extended Outer Continental Shelf (OCS)

claims process and allow for better multi-lateral cooperation in the Arctic.18

UNCLOS includes specific provisions for claims related to the Outer Continental

Shelf (OCS), the seabed and subsoil that may reach beyond a nation’s exclusive

economic zone (EEZ). The EEZ extends past a nation’s 12 nautical mile territorial sea

out to 200 nautical miles from the baseline where the territorial sea originates.19

UNCLOS awards coastal states sovereign rights to the natural resources within their

EEZ and also to those (such as oil and gas) in the Outer Continental Shelf outside their

EEZ.20 Countries submit applications to the Commission on the Limits of the Continental

Shelf based on scientific evidence where their OCS extends beyond the EEZ. Neither

China (a non-Arctic nation) nor the United States (a non-party to UNCLOS) have legal

standing to press any claims to the Arctic extended OCS.

Figure 2: Exclusive Economic Zone and Continental Shelf 21

6

The UNCLOS legal structure intended to resolve Arctic maritime boundary

disputes is similarly unavailable to the United States, despite its unquestionable status

as an Arctic nation. For example, the United States must negotiate resolution of two

boundary disagreements on a bilateral level with Canada – outside the orderly process

enjoyed by signatories to UNCLOS. With an understanding of how nations interact

under this treaty regarding maritime issues, a look at China’s three interests in the Arctic

is the next step.

China’s First Interest: Transpolar Trade Routes

Asia’s growing wealth and middle class are causing a shift in global trade that will

expand maritime commerce through Asia for many years, requiring additional trade

routes to alleviate the congested, vulnerable maritime highways and chokepoints. As

the world leader in global maritime commerce, almost 50% of China’s gross domestic

product is reliant on ocean shipping and China’s ports continue to increase container

throughput capacity.22 Chinese shipping companies view the Arctic as a viable trade

route during the ice-free months. The next section will discuss the three Arctic Ocean

routes that hold such great promise for China’s commerce: the Northern Sea Route

(NSR), the Northwest Passage (NWP) and the Transpolar Sea Route (TSR).

7

Figure 3: Arctic Shipping Routes23

Arctic Ocean Transit Routes

The Northern Sea Route is also known as the Northeast Passage and it runs

along the Arctic coasts of Russia and Norway. Vessels traveling the NSR can realize

significant savings in sailing days (and the cost of fuel) between Northern Europe and

Asia and avoid the risk of piracy associated with the Strait of Malacca near Malaysia.

The traditional warm-water route through the Suez Canal requires on average 48 days

and 11,300 nautical miles for oil tankers and large container vessels. That same voyage

along the NSR is 13 days and 4,000 nautical miles shorter.24 In 2014, the NSR was

open to maritime traffic for six weeks from mid-August until 1 October; the NSR

Administration Office received over 600 transit applications (a record number).25

Russia defines the NSR as the leg transiting Russia’s internal waters from the

Bering Strait to the western edge of the Kara Sea and consequently regulates vessel

traffic along it.26 Specifically, vessels must apply for transit permits and are subject to

8

inspection by Russian authorities. Currently, Russia and the other Arctic nations hold

strong differences in interpretation about the applicability of the UNCLOS terms, leading

to protests against Russia’s “improper implementation of UNCLOS provisions” to

support its sovereignty interests.27

Russia’s regulation of the NSR magnifies her global strategic importance to other

maritime trading nations. China’s Polar Institute stated that if conditions permit, 5% to

15% of China’s international trade could move via the NSR by 2020; its number of NSR

transit permits today trails only Korea and Japan.28 Some scholars believe China’s

influence as a global leader in maritime shipping may force Russia to ease its control

over this route as China advocates for its vessels’ freedom of navigation rights to transit

the Arctic.29

The Northwest Passage begins near Greenland, threads its way through the

Canadian Arctic Archipelago to its western terminus south of the Bering Strait. The

NWP reduces distances between ports in Asia and Europe by nearly 5,000 kilometers

compared to other routes such as the Suez Canal.30 For example, the Nordic Orion, a

bulk carrier, saved $200,000 and four days transiting from Vancouver to Finland via the

NWP in the ice-free month of September 2013.31 Experts predict traditional non-ice

strengthened vessels will be able to make the voyage by the summer of 2050.32 The

United States disagrees with Canadian insistence that since much of the NWP passes

between its sovereign islands, it is considered Canadian territorial waters. Instead, the

United States asserts the NWP is an “international strait” whereby “transit passage”

applies.33

9

As the Arctic Ocean ice cap shrinks to reveal ice-free routes in the summer

months, the Transpolar Sea Route will become accessible. The TSR runs across the

Arctic Ocean over the North Pole, unlike the NSR and NWP coastal routes. The TSR is

the shortest of the Arctic routes at 2,100 nautical miles, and it spans from the Bering

Strait to Northern Europe. This route may be the most perilous from a navigation

perspective as it requires a mostly ice-free Arctic Ocean for safe transit. Despite this

restriction, the TSR may become the preferred route since it does not require innocent

passage through the Russian or Canadian EEZs where they seek to enforce jurisdiction

over vessels using the NSR and NWP, respectively. Current environmental conditions

and future modeling show ice-free summer months possible by the 2030.34

The Chinese government has stated it shall “ensure the safety of marine

transport channels and maintain our country’s marine rights and interests.”35 As a result,

China has invested heavily in naval shipbuilding to protect assets and shipping routes in

the Indian Ocean as manufactured products move west and petroleum is shipped east

to China. “With the expansion of the country’s economic interests, the navy wants to

better protect the country’s transportation routes and the safety of our major sea lanes,”

stated by a senior Chinese officer.36 As the Arctic thaws and vessel transits increase,

China could use its large naval presence to project power to ensure the safety of its

vessels transiting the Arctic.

China has also expanded its civilian maritime capability to operate in the Arctic.

Currently China has one polar icebreaker with another in production.37 The Xuelong

(Snow Dragon) is China’s first polar icebreaker.38 The 167-meter vessel can break 1.2-

meter thick ice and has deployed on five Arctic research expeditions since 1999.39

10

China’s new eight-thousand ton icebreaker will come at a cost of nearly $200 million

dollars, reflecting the level of commitment China is displaying in the future Arctic.40 Once

complete, the vessels will deploy to the Arctic and Antarctic for over 200 days per

year.41

In contrast, the United States, an Arctic nation, currently has only two operational

polar icebreakers to support both the Arctic and Antarctic deployments. However, unlike

China, the U.S. Congress has committed no funding to a much needed replacement

icebreaker. The U.S. Coast Guard cutters Polar Sea and Polar Star were built in the

1970s as “heavy icebreakers”— the most powerful non-nuclear icebreakers in the

world.42 In 2000, the Coast Guard commissioned the Healy, an Arctic-only, medium

icebreaker, funded by the Department of Defense. In 2006, Polar Star was placed in

indefinite caretaker status with no funding to replace her engines. Her sister ship

avoided the same fate only after a nearly $60 million, 10-year service life extension. The

Coast Guard is left to support U.S. maritime activities in the Arctic Ocean while

resupplying American installations in Antarctica with only two icebreakers.43

In support of its Arctic maritime vision, China is also investing in ice-strengthened

vessels to carry both bulk cargo and containers. China’s stated use of the vessels is for

scientific polar research, but the ice-strengthened vessels will provide the capability to

assist Chinese vessels transiting the ice-choked Arctic waters of the NSR. Their

unstated mission will be to maintain Arctic maritime domain awareness.

China’s Interests: Petroleum and Minerals

According to the U.S. Geological Survey, the Arctic region contains

approximately 90 billion barrels of oil, 1.7 trillion cubic feet of natural gas, and 44 billion

barrels of natural gas liquids. 84% of the untapped petroleum resources are located in

11

offshore areas of the Arctic Ocean.44 China, meanwhile, is a net importer of oil; its

demand will continue to grow until it leads the world by 2020. China currently gets half

of its oil supply from the Middle East via oil tanker and is also a leading importer of

natural gas. Middle East conflicts or interruptions in the sea-lane supply routes would

likely have a severe impact on the Chinese economy.

As a result, China must seek alternate sources of oil and natural gas to fuel its

immense economy. The Arctic offers a source in a more politically stable area and

closer to China than its current Middle East suppliers. Russia and China are building

partnerships for development of Arctic oil and liquefied natural gas production from the

Russian Arctic.45

The Arctic is a potential source of mineral resources China needs for its robust

manufacturing sector. Greenland, which is a part of Denmark, holds large reserves of

copper, uranium, and other minerals that make it an area of keen interest for Chinese

companies and her government. Greenland’s ores are so plentiful that they can meet a

quarter of the world’s demands for uranium and rare earth metals needed for

manufacturing in China.46 Elsewhere, a Chinese corporation recently purchased a

quartzite mine in Norway, an iron-ore deposit in Greenland, and has planned oil

exploration in the waters of neighboring Iceland.47 These investments, which often cost

several billion U.S. dollars, provide economic boosts to the smaller Arctic nations who

partner with Chinese state-run corporations.

China’s Interests: Fisheries

China may also have an interest in the untapped fisheries of the Arctic. With the

world’s largest population, China has a great demand for food. Historically most

Chinese, especially those who live near the coast, have relied on fish as a source of

12

protein. According to a 2010 study on global fisheries conducted by the Pew

Environment Group, China leads the world in catch by tonnage as well as in overall

consumption of fish.48 The growing Chinese middle class places greater demand on

China’s fishing industry to find new sources, such as the bountiful Arctic Ocean.

China has a global distant-water fishing fleet of over 2000 vessels (10 times

larger than the United States).49 Currently, China has nearly 400 vessels operating in

West Africa and 100 vessels fishing the waters of South America.50 Chinese fishing

vessels are generally not compliant with international fishing standards and regulatory

practices; they have been cited or seized for illegal fishing from South Korea to

Indonesia.51 China’s disregard for fisheries management and refusal to control its fishing

vessels could be disastrous for the unpatrolled waters of the Arctic.

In 2014, five Arctic nations (Canada, Denmark, Norway, Russia and the United

States) signed a ban on commercial fishing in the Arctic Ocean to protect the living

marine resources of the thawing region.52 The United States had previously banned

commercial fishing north of the Bering Strait in 2009. With the exception of the

aboriginal native groups living in the Arctic who are allowed to harvest fish and sea

mammals, there are no commercial Arctic fisheries. Fisheries stocks such as herring

and cod are predicted to flourish as the climate warms.53

China may be positioning itself to exploit these marine resources of the unspoiled

Arctic. Bans and active enforcement of national fisheries regulations may be seen by

China as denying its right to the so-called “global commons.” This increasingly robust

stance by China may be reflected in the deficit of fisheries agreements in the Arctic.

Surprisingly, despite its mandate to “promote cooperation…on issues of sustainable

13

development,” the Arctic Council has not created a regional fisheries management

organization as exists in other important fisheries around the globe.54 This could be a

result of China’s lobbying efforts; this indirect approach against the only Arctic

governance structure reflects China’s desire to gain influence in this realm – the second

theme of this paper.

China’s Role in Arctic Governance

The Arctic Council was established in 1996 and is headquartered in Tromsø,

Norway.55 It is a high-level intergovernmental forum, which addresses issues faced by

the eight Arctic governments and the indigenous people of the Arctic.56 Although, the

Council’s original mandate was sustainable development and environmental

awareness, it has expanded both in mission scope and membership.

The Arctic Council lacks regulatory authority on security issues, and its actions

are non-binding, which undermines its potential effectiveness.57 The Council has been a

forum for collaboration and consensus between members. Although the Council’s

mandate has not been expanded, the group has accomplished significant multi-lateral

agreements. In 2011, Council members signed the Aeronautical and Maritime Search

and Rescue agreement.58 This represents the first binding agreement under the

authority of the Arctic Council. Another recent example of coordination is the Arctic oil

spill response plan. Both initiatives were developed out of necessity due to the limited

infrastructure and resources of the region.

China’s Observer Status on the Arctic Council

During its period of secretariat of the Arctic Council from 2007-2013, Norway

lobbied for inclusion of China as an observer.59 Observer states and organizations are

not allowed voting rights on issues brought before the Council. In addition, China

14

(perhaps due to its commercial interest in Greenland’s mines) petitioned Denmark to

lobby for this expansion, too. Some Arctic states opposed the enlargement of the

Council by observer states (read: China), assuming their interests were merely

economic.60 Russia, at first, resisted the admission of China, as it would potentially

upset the balance of power in the Arctic. Its delegates believed that China, as a non-

Arctic nation, would attract unwanted attention to the region.61

These concerns about China’s Arctic intentions were likely stirred up by a leading

Chinese Arctic commentator, Li Zhenfu. He has opined that China’s scientific interest in

the Arctic is window dressing for other interests. Li has spoken of “the possibility of our

country’s open declaration of sovereignty over the Arctic and Arctic sea routes, as well

as [a] territorial claim.”62 Additionally, in 2011, a top Russian Navy admiral labeled China

a threat to Russian economic interests in the Arctic.63

As a result, Canada proposed limitations to alleviate Russia’s concerns. Under

the terms of admission to the Council, the observers must acknowledge the sovereign

rights of Arctic nations and the application of UNCLOS. All observer states will come

under review by the full members of Arctic Council every four years and are not allowed

to vote on issues brought before the Council.64 Ultimately, the Arctic Council admitted as

observers China, France, Germany, India, Italy, Japan, Korea, the Netherlands, Poland,

Singapore, Spain and the United Kingdom, as well as nine intergovernmental and

eleven non-governmental organizations.65 According to Espen Barth Aide, Norway’s

Foreign Affairs Minister, “We want people to join our club. That means they will not start

another club.”66 Expanding the Arctic Council to non-Arctic states was important

because issues such as marine transportation regulations would require support from

15

non-Arctic states utilizing new trade routes. The aim of expanding the membership is

not only to build the Council’s stature but also to maintain its status as the body of

reference for all Arctic issues.

China is on a mission to convince the Arctic Council and the world that it has

legitimate rights to the Arctic and its resources. In anticipation of the 2015 session,

China wants to change the rules of the Arctic Council and is lobbying for full

membership status. Calling itself a “near Arctic state,” China argues the Arctic is a

global commons and that it should have access to the region’s natural resources and

scientific research potential.67 According to Chinese Navy Admiral Yin Zhou, the “Arctic

belongs to all the people around the world, as no nation has sovereignty over it…China

must play an indispensable role in Arctic exploration as [it] has one-fifth of the world’s

population.”68

As a result, many countries have questioned China’s role and interests in the

Arctic. A Canadian official stated, “There exists in China a distinct group of academics

and officials trying to influence their leaders to adopt a much more assertive stance in

the Arctic than has traditionally been the case. This could ultimately bring China into

disagreement with circumpolar states in a variety of issue areas and alter security and

sovereignty relationships in the circumpolar region.”69

U.S. Opportunities to Encourage China’s Responsible Actions in the Arctic

In 2015, the United States will assume the leadership chair of the Arctic Council

for two years. President Barack Obama appointed a well-qualified chairman, retired

Admiral Robert Papp, former U.S. Coast Guard Commandant. As Commandant, he

worked closely with his Chinese counterparts on the North Pacific Coast Guard Forum

and strengthened the China-United States ship-rider program, where Chinese maritime

16

enforcement officers deploy on U.S. Coast Guard cutters operating in the Western

Pacific. The latter program is a sterling example of international cooperation to combat

transnational maritime crime, specifically the prevention of illegal commercial fishing.

Papp established strong relationships with navy and coast guard leaders from other

Arctic nations to develop the Arctic search and rescue and oil spill response plans.

China and America share a common interest of freedom of navigation in the

Arctic. China does not view the United States as an Arctic power, unlike Canada and

Russia. Perhaps China’s attitude stems from the lack of any serious U.S. Arctic

strategy, its refusal to ratify UNCLOS, and diminished American operations in

comparison to other Arctic states.70

One option the new Arctic Council leadership may consider would be to offer

China full member status in return for China submitting its controversial maritime claims

in the South China Sea to UNCLOS arbitration. This alternative would take close

coordination not only between Arctic member states but also nations bordering the

South China Sea. To date, China’s official messages concerning its interests in the

Arctic have followed twin themes of scientific research and environmental monitoring,

with undertones of natural resource allocation and new trade routes. China has shown

great support of the Arctic Council and the underlying framework of UNCLOS as it

applies in the Arctic.

At the same time, China has been unwilling to consider UNCLOS as a forum for

arbitration of maritime boundary disputes in the South China Sea. China’s signing of

UNCLOS in 1996 was qualified by its rejection of certain provisions in dispute resolution

clauses.71 Offering full member status on the Arctic Council in return for China’s

17

submission to UNCLOS arbitration elsewhere on the planet may reveal China’s true

ambitions. Both the South China Sea and the Arctic Ocean offer similar natural

resources in the form of oil, natural gas and fisheries.

The United States may have an opportunity to collaborate with China on the

Arctic Council while working to shape its expanding influence in the Arctic. China’s

Twelfth Five Year Plan calls for increased coordination and cooperation to include

forging bilateral and multilateral maritime cooperation agreements as well as active

participation in international maritime forums.72 Acknowledging China’s great power

status may encourage China to embrace a more cooperative tone and transparent

efforts in the Arctic.

Even if not offered full member status, China will likely continue to expand

economic partnerships with smaller Arctic countries such as Denmark and Iceland to

meet China’s future natural resource demands. The Arctic Council, under U.S.

leadership, needs to monitor these relationships and prevent China from becoming a

quasi-Arctic state to dissuade China from asserting sovereignty over natural resources

and conducting illegal commercial fishing.

For example, China has formed a strong bilateral relationship with Iceland; the

evidence is China’s construction of the largest embassy in Reykjavik. Iceland is allowing

the Chinese National Offshore Oil Corporation to develop projects on its continental

shelf.73 Additionally, China’s only free trade agreement in Europe exists with Iceland.74

Iceland has experienced significant problems with its economy since the 2008 banking

collapse, and the opportunity to collaborate with a rising China is expected to offer a

source of financial resources in the future.75 The chair and the members of the Arctic

18

Council must be alert to votes by Iceland. Are they truly being cast by Iceland and are

they in the best interest of the Council? Or is China acting through its de facto Arctic

proxy?

China’s interest in the Arctic may also be about the broader strategic interests of

a rising China as a global power. As such, China has recently flexed its muscle on the

United Nations Security Council through the increased use of its permanent member

veto power (five times since 2007).76 Likewise, it has become a more assertive leader in

Asian multinational forums such as the Shanghai Cooperation Organization.77

Conclusions

The Arctic will continue to be a strategically important region into the future as

nations position themselves to take advantage of the untapped resources and

expeditious maritime routes. Although China’s interests in the Arctic started with

scientific research, they have evolved into a desire to exert influence over the control

and distribution of the bountiful natural resources (oil, natural gas, minerals, and fish

stocks) required to sustain China’s population and fuel the world’s largest economy.

According to Stephen Blank, “China is clearly after more than simply investment and

trade opportunities as it continues to display its obsession with securing energy and

other supplies where the U.S. Navy cannot or will not go.”78 Additionally, to secure

future safety and security of its marine transportation, China wants to utilize the nascent

shipping routes of the Northern Sea Route, Trans Polar Sea Route, and the Northwest

Passage.

The label of the United States as an “Arctic nation” by national policy makers is

not borne out by the intensity of American policy and activity in the region.79 Unlike

Russia and Canada, the United States is neither an Arctic power nor a threat to China’s

19

rising influence in the region, which may be an advantage in dealing with China. The

Beijing Review trumpets, “China has ultimately managed to reshuffle the Arctic balance

of power in record time.”80 Consequently, the United States, as the incumbent chair of

the Arctic Council, should leverage its leadership as an opportunity to encourage China

to become a responsible member of the Arctic community.

Despite some concerns by larger Arctic nations, China was accepted for

observer status on the Arctic Council. China will obviously leverage this position to

advance its interests in the region. Some argue China will not be satisfied with this

limited role in Arctic affairs and will continue to lobby for full membership on the Council.

However, the Arctic Council can capitalize on China’s leadership position in the global

economy to boost the strategic importance of the group.

The Arctic Council is the model of governance and has established a strong

reputation for cooperation and mutual respect among Arctic nations, as evidenced by

the Arctic SAR and oil spill agreements. China’s burgeoning influence may be a threat

to this framework of Arctic cooperation. China, therefore, should not be allowed to

create implicit proxy states through financial leverage or to exert undue diplomatic

influence on smaller, politically and economically weaker Arctic states such as Iceland.

The risk of an unchecked China in the region may be regional instability and a lack of

trust and cooperation among Arctic nations.

Alternatively, the rise of China in the Arctic may be seen as a balance to Russia,

which is the most active and provocative state in this region. Both Russia and Canada

have communicated their intent to exert control over areas of the NSR and NWP.

Although it has not ratified UNCLOS, the United States treats the international

20

framework as customary international law and should promote this model for settling

claims in the region to ensure the equitable distribution of resources and access to

newly available sea routes. China is postured for greater influence in the Arctic, driven

by a desire for additional natural resources and trade routes. The United States should

leverage its term as the Arctic Council chair to induce China to assume the mantle of

responsible partner in the developing Arctic.

Endnotes

1 Scott Borgerson et al., the Emerging Arctic, Council on Foreign Relations, 2014. http://www.cfr.org/arctic/emerging-arctic/p32620#!/ (accessed March 4, 2015).

2 Baker Vail Design, “Map of the Arctic,” http://www.bakervailmaps.com/map-illustration/world-maps/arctic-circle-map.html (accessed January 30, 2015).

3 Shilo Rainwater, “Race to the North,” Naval War College Review 66, no. 2 (Spring 2013): 69.

4 Njord Wegge, “China in the Arctic: Interests, Actions and Challenges,” Nordlit 32 (2014): 87. http://septentrio.uit.no/index.php/nordlit/article/view/3072/2964 (accessed December 4, 2014).

5 Linda Jakobson, “Beijing’s Arctic goals are not to be feared,” Financial Times, May 19, 2013, http://www.ft.com/cms/s/0/3dfd6f16-bef1-11e2-87ff-00144feab7de.html#axzz3PD95q0dA (accessed January 20, 2015).

6 Oleg Vukmanovic and Balazs Koranyi, “Russia’s revival of Arctic Northern Sea Route at least 10 years away,” Reuters, January 25, 2013, http://www.thestar.com/business/2013/01/25/russias_revival_of_arctic_northern_sea_route_at_least_10_years_away.html (accessed January 15, 2015).

7 Rainwater, “Race to the North,” 69.

8 Olga Alexeeva and Frederic Lasserre, “China and the Arctic,” in Arctic Yearbook 2012, edited by Lassi Heininen (Akureyri, Iceland: Northern Research Forum): 81. http://www.arcticyearbook.com/images/Articles_2012/Alexeeva_and_Lassere.pdf (accessed March 10, 2015).

9 Ibid., 81.

10 People’s National Congress, China’s Twelfth Five Year Plan (2011-2015) (English translation), 17, http://cbi.typepad.com/files/full-translation-5-yr-plan-2011-2015.doc (accessed January 25, 2015).

21

11 Caitlin Campbell, “China and the Arctic: Objectives and Obstacles”, U.S.–China

Economic and Security Review Commission (April 13, 2012): 3.

12 Ibid., 4.

13 Central Intelligence Agency, World Factbook, “China”, June 22, 2014. https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html (accessed January 18, 2015).

14 Humpert Malte and Andreas Raspotnik, “The Future of Arctic Shipping Along the Transpolar Sea Route,” in Arctic Yearbook 2012, edited by Lassi Heininen (Akureyri, Iceland: Northern Research Forum): 297. http://www.arcticyearbook.com/images/Articles_2012/Humpert_and_Raspotnik.pdf (accessed March 3, 2015).

15 David C. Wright, “The Dragon Eyes the Top of the World: Arctic Policy Debate and Discussion in China,” China Maritime Studies 8, (August 2011): 7.

16 United Nations Convention on the Law of the Sea, Annex II. Commission on the limits of the Continental Shelf. 1982. Article 76. http://www.un.org/Depts/los/convention_agreements/texts/unclos/annex2.htm (accessed February 7, 2015).

17 Charles Ebinger and Evie Zambetkis, “The Geopolitics of Arctic Melt,” International Affairs 85 (June 2009): 1226-1227.

18 Ibid., 1232.

19 United Nations Convention on the Law of the Sea, Annex II. section V, article 57.

20 Ibid., section VI, article 77.

21 Avin Kumar, “Different Zones of Sea Under UNCLOS,” Marine Engineering, February 26, 2013. http://www.tunnel2funnel.com/2013_02_01_archive.html (accessed February 11, 2015).

22 Humpert and Raspotnik, “The Future of Arctic Shipping Along the Transpolar Sea Route,” 295.

23 Malte Humpert and Andreas Raspotnik, “The Future of Arctic Shipping”, The Arctic Institute, October 11, 2012. http://www.thearcticinstitute.org/2012/10/the-future-of-arctic-shipping.html (accessed February 11, 2015).

24 Jeremy Bender, “Russia is militarizing the Arctic,” Business Insider, December 2, 2014.

25 Mike Schuler, “Northern Sea Route Transit Applications Hit Record High in 2014,” gCaptain, blog entry posted October 28, 2014, http://gcaptain.com/northern-sea-route-transit-applications-hit-record-high-2014/ (accessed February 17, 2015).

26 The Russian Federation, The National Security Strategy of the Russian Federation until 2020 (May 13, 2009), 42. http://rustrans.wikidot.com/russia-s-national-security-strategy-to-2020 (accessed March 3, 2015).

22

27 Oleg Vukmanovic and Balazs Koranyi, “Russia’s revival of Arctic Northern Sea Route at

least 10 years away”, Reuters, January 25, 2013. http://www.thestar.com/business/2013/01/25/russias_revival_of_arctic_northern_sea_route_at_least_10_years_away.html (accessed March 2, 2015).

28 Tom Røseth, “Russia’s China Policy in the Arctic,” Strategic Analysis 38, no. 6 (2014): 851. http://www.tandfonline.com/doi/pdf/10.1080/09700161.2014.952942 (accessed December 4, 2014).

29 Ibid., 852; For more information on the applicable UNCLOS article concerning special regulations dealing with human activities in ice-covered waters, see United Nations Convention on the Law of the Sea. Section VII. Protection and Preservation of the Marine Environment. 1982. Article 234. http://www.un.org/depts/los/convention_agreements/texts/unclos/part12.htm (accessed March 16, 2015).

30 Paul Waldie, “A reality check on the Northwest Passage ‘boom’,” The Globe and Mail, January 7, 2014. http://www.theglobeandmail.com/report-on-business/breakthrough/will-cold-dark-northwest-passage-see-more-ships/article16231502/ (accessed February 27, 2015).

31 Ibid.

32 Ibid.

33 Michael Byers, “Canada Can Help Russia with Northern Sea Route,” The Moscow Times, June 9, 2012. http://www.themoscowtimes.com/opinion/article/canada-can-help-russia-with-northern-sea-route/460127.html (accessed March 16, 2015); United Nations Convention on the Law of the Sea, Part 3, Straits used for International Navigation. 1982. Section II. http://www.un.org/depts/los/convention_agreements/texts/unclos/part3.htm (accessed March 16, 2015).

34 Humpert and Raspotnik, “The Future of Arctic Shipping Along the Transpolar Sea Route,” 285.

35 People’s National Congress, China’s Twelfth Five Year Plan (2011-2015), 17.

36 Rainwater, “Race to the North,” 66.

37 Wang Qian, “New icebreaker planned for 2016: officials,” China Daily, January 6, 2014. http://www.chinadaily.com.cn/china/2014-01/06/content_17216579.htm (accessed January 18, 2015).

38 Alexeeva and Lasserre, “China and the Arctic,” 82.

39 Rainwater, “Race to the North,” 69.

40 Ibid.

41 Alexeeva and Lasserre, “China and the Arctic,” 82.

42 National Research Council, Polar Icebreaker Roles and U.S. Future Needs: A Preliminary Assessment (Washington, DC: The National Academies Press, 2005). Heavy icebreakers are

23

defined as vessels capable of breaking 6 feet of ice continuously at 3 knots, and can back and ram through at least 20 feet of ice; U.S. Coast Guard, “USCGC POLAR STAR (WAGB-10)”. https://www.uscg.mil/pacarea/cgcpolarstar/ (accessed February 5, 2015).

43 U.S. Coast Guard, Fact Sheet Fiscal Year 2013 President’s Budget, http://www.uscg.mil/posturestatement/docs/FY_2013_Budget_Fact_Sheet.pdf (accessed March 4, 2015).

44 Kenneth Bird et al., Circum-Arctic Resource Appraisal: Estimates of Undiscovered Oil

and Gas North of the Arctic Circle, 2008, U.S. Geological Survey Fact Sheet 2008-3049, http://pubs.usgs.gov/fs/2008/3049/ (accessed December 16, 2014).

45 Atle Staalesen, “In Russia-China alliance, an Arctic dimension,” Barents Observer, November 14, 2014. http://barentsobserver.com/en/arctic/2014/11/russia-china-alliance-arctic-dimension-14-11 (accessed February 27, 2015).

46 Elizabeth Economy, “The Four Drivers of Beijing’s Emerging Arctic Play and What the World Needs to Do,” Forbes Asia, April 4, 2014. http://www.forbes.com/sites/elizabetheconomy/2014/04/04/the-four-drivers-of-beijings-emerging-arctic-play-and-what-the-world-needs-to-do/ (accessed February 11, 2015).

47 Wegge, “China in the Arctic: interests, actions and challenges,” 83-98.

48 Pew Environment Group, “China tops world in catch and consumption of fish,” Science Daily, September 23, 2010. http://www.sciencedaily.com/releases/2010/09/100922121947.htm (accessed January 18, 2015).

49 Katie Lebling, “Curbing China’s Massive – and Destructive – Distant Water Fishing Fleet,” The blog of the Wilson Center’s Environmental Change and Security Program, blog entry posted November 11, 2013. http://www.newsecuritybeat.org/2013/11/curbing-chinas-massive-destructive-distant-water-fishing-fleet/#.Uoubp41m6S4 (accessed March 4, 2015).

50 Daniel Pauly et al., “China's distant‐water fisheries in the 21st century,” Fish and Fisheries 15, no. 3 (2014): 474-488, http://onlinelibrary.wiley.com/doi/10.1111/faf.12032/full (accessed March 3, 2015).

51 Lebling, “Curbing China’s Massive – and Destructive – Distant Water Fishing Fleet”; Ben Otto, “China Makes Appeal for Chinese Fishermen Caught in Indonesia,” The Wall Street Journal, December 10, 2014, http://www.wsj.com/articles/china-makes-appeal-for-chinese-fishermen-caught-in-indonesia-1418218872 (accessed March 4, 2015).

52 Lauren Rosenthal, “Five Nations Tentatively Agree to Arctic Fishing Ban,” KUCB-Unalaska, March 6, 2014, http://www.alaskapublic.org/2014/03/06/five-nations-tentatively-agree-to-arctic-fishing-ban/ (accessed December 16, 2014).

53 Heather Exner-Pirot, “New Direction for Governance of the Arctic Region,” Arctic Yearbook 2012, edited by Lassi Heininen (Akureyri, Iceland: Northern Research Forum): 238. http://www.arcticyearbook.com/images/Articles_2012/Exner_Pirot.pdf (accessed March 10, 2015).

24

54 Erik J. Molenaar and Robert Corell, Arctic Fisheries (Brussels: Arctic TRANSFORM,

February 9, 2009): 23, http://arctic-transform.org/download/FishBP.pdf (accessed February 9, 2015); U.S. Department of State Press Statement, “Chairman’s Statement at Meeting on Future of Arctic Fisheries,” Washington, DC, May 1, 2013, http://www.state.gov/e/oes/rls/pr/2013/209176.htm (accessed February 9, 2015).

55 Joint Communique of the Governments of the Arctic Countries on the Establishment of the Arctic Council (“Ottawa Declaration”), Ottawa, Canada, September 19, 1996. http://www.arctic-council.org/index.php/en/document-archive/category/5-declarations?download=13:ottawa-declaration (accessed February 9, 2015).

56 Arctic Council Observers Page, http://www.arctic-council.org/index.php/en/about-

us/arctic-council/observers (accessed March 3, 2015).

57 Heather Conley and Jamie Kraut, U.S. Strategic Interest in the Arctic: An Assessment of Current Challenges and New Opportunities for Cooperation, A report of the CSIS Europe Program at the Center for Strategic and International Studies, April 2010, 13. http://csis.org/files/publication/100426_Conley_USStrategicInterests_Web.pdf (accessed March 20, 2015).

58 The Arctic Council, “First Live Arctic Search and Rescue Exercise - SAREX 2012,” September 25, 2012. http://www.arctic-council.org/index.php/en/environment-and-people/oceans/search-and-rescue/620-first-arctic-search-and-rescue-exercise-sarex-2012 (accessed on March 3, 2015).

59 Morten Brugard, “Norway says yes to China in Arctic Council,” Barents Observer, January 22, 2013. http://barentsobserver.com/en/arctic/2013/01/norway-says-yes-china-arctic-council-22-01 (accessed on January 18, 2015).

60 Røseth, “Russia’s China Policy in the Arctic,” 844.

61 Ibid.

62 Wright, “The Dragon Eyes the Top of the World,” 9.

63 Røseth, “Russia’s China Policy in the Arctic,” 847.

64 Ibid.

65 The Arctic Council, http://www.arctic-council.org/index.php/en/about-us/arctic-council/observers (accessed February 27, 2015).

66 Brugard, “Norway says yes to China in Arctic Council.”

67 Arthur Guschin, “Understanding China’s Arctic Policies,” The Diplomat, November 14, 2013. http://thediplomat.com/2013/11/understanding-chinas-arctic-policies/ (accessed March 16, 2013).

68 Economy, “The Four Drivers of Beijing’s Emerging Arctic Play.”

69 Wright, “The Dragon Eyes the Top of the World,” 6.

25

70 Ibid., 3.

71 United Nations Convention on the Law of the Sea: Declarations made upon signature, ratification, accession or succession or anytime thereafter, China, June 7, 1996. http://www.un.org/depts/los/convention_agreements/convention declarations.htm#China Upon ratification (accessed March 3, 2015).

72 People’s National Congress, China’s Twelfth Five Year Plan (2011-2015), 17.

73 Richard Milne, “CNOOC teams up with Icelandic group in its play for Arctic Oil,” Financial Times, June 9, 2013. http://www.ft.com/intl/cms/s/0/7cd80ca8-d0fa-11e2-a3ea-00144feab7de.html#axzz3TRrlxrvI (accessed March 3, 2015).

74 Wegge, “China in the Arctic: interests, actions and challenges,” 91.

75 “Iceland rises from the ashes of the banking collapse,” The Guardian, October 6, 2013. http://www.theguardian.com/world/2013/oct/06/iceland-financial-recovery-banking-collapse (accessed March 3, 2015).

76 Ibid., 86.

77 Ibid.

78 Stephen Blank, “China’s Arctic Strategy,” The Diplomat, June 20, 2013. http://thediplomat.com/2013/06/chinas-arctic-strategy/ (accessed March 9, 2015).

79 Robert J. Papp, “America is an Arctic Nation,” The White House Blog (December 2, 2014). http://www.whitehouse.gov/blog/2014/12/02/america-arctic-nation (accessed January 25, 2015).

80 Blank, “China’s Arctic Strategy.”